Mortgage Overview
A mortgage is the biggest loan most people will take out in their lifetime. But just how is this loan funded?
Who else does your mortgage provider do business with? Might they also lend to big corporations involved in areas you don't approve of? Do they lend responsibly to their customers and offer assistance to those who fall into financial difficulty? Do they offer incentives to environmentally-sound projects?
If you're thinking of buying property or your existing mortgage is up for renewal, this section will help you find a green and ethical provider.
Find out about your current or prospective provider
What are the green and ethical options?
Find out about your current or prospective provider
Use the mortgage search to find out more about your current or prospective mortgage provider's green and ethical credentials. Key areas considered are responsibility toward customers, financial exclusion, equal opportunities, environment and also whether they have an ethical lending policy or guidelines in place.
Responsible lending
The importance of responsible lending cannot be overemphasized. The recent global economic downturn is often attributed to the 'sub prime crisis'. This refers to the granting of loans to people who are considered to be in higher risk categories - those more likely to default or who have a poor credit history, for example.
This type of lending is not problematic in itself - credit unions and community development finance institutions regularly lend to sub prime candidates.
Instead, irresponsible lending to customers in the sub prime category is the problem. In the build up to the crunch some financial institutions were lending 100% mortgages (and in some cases more) to people who would not be able to make their repayments in the long term.
Key questions to ask: Does your bank have responsible lending policies that ensure that its products are targeted in an appropriate manner? And does it provide advice or debt management services to customers who fall into financial difficulty?
What are the green and ethical options?
- Co-operative Bank: has a well-recognised ethical policy in place that governs all its lending decisions and products including mortgages. It also offers a specific Green Mortgage and re-mortgage product. Additionally it offers a reduced-rate loan to mortgage customers wishing to purchase and install energy efficient home technologies from an approved list.
- Ecology Building Society: has an 'ecological' lending policy which applies across all lending practices. It offers a number of green mortgage options.
- Norwich & Peterborough Building Society: offers a Green mortgage which plants 40 trees per mortgage and available for new homes with a Standard Assessment Procedure (SAP) rating of 100 or higher or to those looking to make their home more energy efficient. It also offers a Brown mortgage which includes a free energy survey and advice on making property energy efficient.
Your next steps
Check out our Next Steps Guide - Mortgages for suggestions on how to find the right green and ethical mortgage provider for you as well as the questions you should be asking your current or prospective provider.
Mortgage Search
Mortgage Provider
Virgin Money
Green/Ethical Products
Virgin Money operates a Climate Change Fund (available to ISA savers) which seeks to invest in renewable energy companies. The fund’s managers have explicitly stated that this fund does not apply any socially responsible investment criteria to the investment process.
Ethical Lending or Insurance
No evidence of an ethical lending policy was found.
Responsible Lending
1. Credit Lending
No evidence of credit checking with reference agencies was found, only the following statement re credit limits: ‘The limit given is based on your personal circumstances. If you’ve got a high salary and low debts, you’re more likely to get a higher credit limit.’
No policy was found to avoid or prevent offering unrequested increases in credit limits to customers.
2. Debt Warning
No warnings were found with regard to the consequences of payment default. Nor was any reference to the FSA Debt Test or similar found. This test is designed to help customers find out whether you have, or are likely to have, problems with borrowing. It also has tips on what to do if customers find themselves in difficulties.
3. Debt Management and Advice
No information or policies on payment default and handling payment problems were found. Similarly no information with regard to the possibility of payment holidays/breaks was found.
Financial Exclusion
Virgin Money does not offer any products or services to the financially excluded. We found no evidence that it engages with credit unions or other mutual organisations; that it funds microfinance projects or that it lends at preferential rates or invests in deprived communities.
In terms of access, its website is accessible to customers with disabilities. It also provides literature in Braille, large print and audio tape, as well as offering Typetalk services.
Environment
No public data on the specifics of Virgin Money’s environmental policy was found.
Carbon Neutral
No evidence of a pledge was found, however, the parent company, the Virgin Group, reports that all ‘key’ UK office sites are run on renewable energy and that extending this across all ground operations is being considered.
Equal Opportunities
The company’s policy addresses the key issues of gender, race, disability and sexuality.
Women on the Board
No data found.
Voluntary Standards & Initiatives
None
Virgin Money
- Credit Card
- Loans
- Savings
- Investments
- Mortgages
- Pensions
- Insurance (Home, Motor, Travel, Pet, Life)
Virgin Money
Virgin Money
The Service Quality Team
Discovery House
Whiting Road
Norwich
NR4 6EJ
